Exelon scraps plans to squeeze more power from Limerick reactors

LIMERICK — Exelon Nuclear has made official what many market analysts have known for some time — that cheap natural gas from Marcellus Shale drilling and lowered electricity prices have made it impractical for the company to pursue its plans to squeeze more electricity out of the Limerick Generating Station.

Called an “uprate,” the company had plans to increase output from Limerick and two plants in Illinois by 1.6 percent.

Had the plans moved forward, Exelon intended for Limerick to generate an additional 270 megawatts of power. Currently, the two reactors at the plant generate 2,345 megawatts of electricity.

The plant’s two reactors went online in 1984 and 1989 and the company has applied to the U.S. Nuclear Regulatory Commission to extend the licenses for each reactor by another 20 years.

That was the same month that Reuters reported that the NRC accepted the company’s application to modify its Peach Bottom nuclear plant in Pennsylvania to increase the plant’s capacity by 12.4 percent.

The two reactors at Peach Bottom currently have a capacity of 1,122 megawatts, enough to power more than 1 million homes, and Exelon officials have said that uprate project will move forward.

Exelon had previously deferred the plans for Limerick and the LaSalle Nuclear Plant in Illinois and on June 5, the company made the decision to cancel those uprate projects, according to Dana Melia, site communications director for the Limerick plant.

“Nuclear uprates remain an important component of Exelon’s long-term growth strategy and the company will continue to evaluate power uprate options,” Melia wrote in response to an email from The Mercury seeking comment.

She informed the plant’s community advisory group on Wednesday, writing “cancellation of the projects will not affect Exelon employees or the plant’s ability to provide safe, clean, reliable energy to more than 2 million homes in the region” and further saying the decision was “based on market conditions.”

“We removed these previously deferred extended power uprate projects from our program in response to market conditions and artificially depressed power prices resulting from subsidized wind energy,” Exelon spokesman Paul Elsberg said in a statement published by the on-line news service.

“Extended power uprates are large investments with paybacks toward the end of plant life, and in this instance, we decided that the risk involved did not provide the necessary returns,” Elsberg said.

“The utility’s executives have said wind energy tax credits are allowing companies to give away power for free or at negative prices at a time when gas supplies are historically low. Such factors, Exelon has said, are making it harder for nuclear reactors to compete in competitive markets,” according to Midwest Energy News. “Exelon is mainly concerned with the federal tax credit of 2.3 cents per kilowatt-hour, which has allowed wind generators to pay consumers to take their electricity at certain points of low demand and excess capacity, such as overnight.”

But the American Wind Energy Association thinks Elsberg’s statement is just an excuse.

“Exelon continues to use wind as a scapegoat for its significant financial woes,” Rob Gramlich, AWEA’s senior vice president of public policy told Midwest Energy News. “They made a losing bet on power market prices, which their earnings reports describe quite clearly. That is not a policy issue, it is a market issue unique to that company.”

In a filing with the Securities and Exchange Commission, the company said that rather than pursue the uprate projects at Limerick and LaSalle, it would take a $100 million loss in the second quarter of 2013.